The elephant in the room in PH-Belgian relations

Belgian interest in the Philippines is much older than most people here realize, although the slightly odd story of its beginnings does take up a couple pages in Ambeth Ocampo’s 2009 book, Looking Back. In 1866, King Leopold 2nd of Belgium, on the throne for less than a year, began an aggressive search for some place in the world where his kingdom could establish an overseas colony; much like Germany, Belgium found itself far behind rivals such as England and France in the race to establish globe-spanning empires, a disadvantage the new Belgian monarch was anxious to correct. Deciding that establishing an overseas commercial enterprise as a private citizen would be faster than working through “official” channels, Leopold obtained a loan from the Belgian government and instructed the Belgian ambassador in Spain to approach Queen Isabella 2nd (whose statue stands watch over the Puerto Isabel in Intramuros) about the possibility of Spain ceding the Philippines to Belgium, or alternately, granting Philippine independence in a way that would allow Leopold and his corporate partners to gain control of the archipelago.

Spain under Isabella 2nd was in poor financial straits and wracked by internal discord, so selling off the Philippines to the wealthier Belgians would have made a certain kind of sense. But it would have also eliminated the largest and most lucrative of the Spanish Jesuits’ few remaining strongholds, and since the Jesuits were one of the few groups keeping Isabella 2nd on the throne (she eventually would be deposed and exiled to Paris in 1868), they made sure King Leopold’s plan went nowhere; the Belgian King turned his attention to Africa instead, establishing a territorial holding remembered mostly for its appalling exploitation and abuse of the native population, and which is today the Democratic Republic of the Congo.

The experience of the Congolese being what it was, the people of the Philippines should probably consider themselves fortunate to have never fallen under the personal authority of Leopold 2nd, but as far as the rest of the Belgians are concerned, the relationship between their country and the Philippines has been a friendly and productive one. That was the point stressed by Belgian Ambassador Christian Meerschman at The Manila Times offices on Thursday (July 4), in a roundtable discussion in which the outgoing ambassador (his term ends in September, whereupon he will be returning to the civil service) shared some of his impressions of his four years as Brussels’ representative in the Philippines.

Those generally good relations are a large part of the reason why Meerschman was reluctant to discuss the elephant that has been in the room since early in President Benigno Aquino 3rd’s term in office, the latter’s abrupt and arbitrary cancellation of the P18.7-billion Laguna Lake Rehabilitation Project back in November 2010. That project, which was to be undertaken by the internationally known Belgian maritime engineering firm Baggerwerken Decloedt and Zn (BDC), would have involved dredging Laguna de Bay to improve water flow and flood-control capacity, with the dredged material being treated and reused to create about 100 hectares of artificial wetlands at the lake’s northern end as a further pollution- and flood-control measure. Despite reviews—ordered by President Aquino himself—of the contract by both the Department of Environmental and Natural Resources (DENR) and the Department of Justice finding no anomalies and endorsing it as a worthwhile project, Mr. Aquino unilaterally abrogated the contract, saying he “was allergic” to dredging projects because of their risk of corruption, and declaring that “Even a Grade 5 student will easily see that this project is illogical,” a less-than-subtle slur coming from a former shoe salesman, given the comparative expertise of a marine engineering firm that has been in business since 1876, not to mention the trained engineers, environmentalists, accountants and attorneys within his own government.

Ambassador Meerschman, who explained that his first notification of President Aquino’s move (something that the President is still proud of, and routinely mentions is his “straight path”-themed speeches during his frequent overseas forays) was from the local news, characterized the President’s reasoning as “a bit insulting,” saying that it appeared the only reason for the abrupt withdrawal of the project was that it had been signed during former President Gloria Arroyo’s term. Unlike other projects that fell to President Aquino’s personally motivated axe at the same time, however, such as the French-sponsored roll-on/roll-off port contract which found new life in fresh contract negotiations, the Belgian government and Belgian firms virtually wrote off any involvement in Philippine government-related projects. “We still have many projects here, and I don’t want to give the impression that this one case is representative of Belgian interests in this country,” Meerschman explained. “On a business-to-business level, our investors have very good relations, and there is much interest. With government projects, though, things are problematic, so there is not really any activity in that area.”

And it is not hard to imagine why. In April 2011, after a couple months of futile discussion with the Aquino administration over the canceled project, BDC filed an arbitration case for P6 billion against the Philippine government with the International Center for the Settlement of Investment Disputes (ICSID) in Washington, D.C., Shortly before that, Ambassador Meerschman, in his capacity as the informal head of the European Union group of envoys in the Philippines, called a meeting of all 27 EU ambassadors “to discuss the sincerity of President Benigno Aquino 3rd in upholding contracts, in light of the shelving of the P18.7-billion Laguna Lake Rehabilitation Project.” after a letter from Belgian Prime Minister Yves Leterme to President Aquino about the issue went unanswered. According to Meerschman, the case filed in Washington—which will not be resolved before 2014 at the earliest—was not simply a matter of wounded feelings, but real financial damage: BDC had invested as much as 50 million euros in preparation for the work, including the construction of a number of special vessels capable of accessing the lake through the Pasig River and its low bridges. Cancellation of the project meant those vessels had to be scrapped, and approximately 500 BDC employees and contractors lost their jobs.

Even so, Meerschman, ever the diplomat, would not like the BDC case to spoil things between Belgium and the Philippines. “We have good relations,” he explained reassuringly. “There are many Belgian companies interested in doing business here, many Belgian citizens who have retired here, and Belgium is happy to host many of your workers. This case is now in the hands of the court [the ICSID], so I really wouldn’t wish to comment on it further.” Still, the elephant in the room is hard to ignore. When asked what he would remember most about his time in the Philippines, and what he would like to leave behind for his successor, Meerschman grew somewhat wistful: “Before the Philippines, I was in Kazakhstan, a very empty place,” he said. “Here I’ve enjoyed the crowds and the friendly people. It [the Philippines]is an easy posting, and I am happy to have been here.” But almost reluctantly he added, “Still, I regret that this situation has happened during my time here. I would have liked for it to have been resolved.”

4 Comments

Obviously, BS Aquino do not want people to know that GMA was indeed one of the most productive and working president of the Philippines/Filipinas. It will be an insult on his “ego” if he granted to pursue all the major project like this. Having a psychopath in Malacañang, Mr. Brown has the right to say that we are indeed living in the “gates of hell” and one of those usherettes are wearing this yellow ribbon sign.

One of the very valuable areas in Manila today is the land reclaimed at the Manila Bay. I cannot understand why the president expressed disdain for reclamation projects because obviously all those involved in the Manila Bay reclamation area, the current administration included, are raking in tremendous income and we have just begun to scratch the surface. The boom in tourism alone with the casinos opening up is mind boggling and these are mainly on the reclamation area, why even the inauguration of one casino was graced by the president himself. A big portion of the reclamation was in fact done under a joint venture with a Belgian company at no cost to the goverment. It is not therefore reclamation projects per se that the president dislikes, this will not make sense since reclamation projects all over the world is a proven method of executing infrastracture projects profitably and strategically, even our own reclamation in the Manila Bay clearly demonstrates it. It must be because the Laguna Bay dredging project was under the former administration of Gloria Arroyo and nothing else. I am curious whether the president on his own cancelled the project or it was upon the advise of an “expert” and if the latter I would want to know who. We are now facing a 6 billion suit for heeding that advise and if we lose I think that tHat expert should be made to account for it.

To clarify again, no — the cancellation of the project was the President’s sole decision, taken contrary to the advice of ‘experts’. The LLRP underwent agency-level reviews three separate times, the last one as part of a general review of all outstanding projects shortly after Aquino took office (a move that by itself was reasonable, it was understandable that a new Administration would want to review the leftovers of the old one). The LLRP needed to be checked to make sure that first of all, it was a sound project from an engineering point of view, and fit any long-term infrastructure plans (DENR), and second, that it was legally correct, had been contracted properly, etc. (DOJ). Both those reviews — by Aquino’s own appointees — gave the LLRP the green light, endorsements that were promptly ignored by the President.

The bottom line is, the cost that the Philippines has already incurred and will incur from that rash and arrogant abuse of authority is his liability alone.